Friday, October 26, 2007

The Scottish Question on Newsnight Tonight

I have spent most of today parked on the M25 on my to and back from the Newsnight studio. They are doing a feature on Alex Salmond's astonishing assertion that Scotland doesn't get enough taxpayers' money spent on it! Last time I looked each person in Scotland gets an extra £1,000 spent on them compared to the English. Newsnight will be playing an extraxct from Justice for England's Part of the Union video which I posted earlier this week (to much joy and horror in equal measure!). I made the point that the Barnett formula needs revisiting, as well as the question of an English Parliament or Grand Committee.

I was told today - and if someone can provide the evidence I'd be grateful - that under the Barnett formula Scotland will actually benefit from the Crossrail project. Bear with me. If the Government commits £5 billion to an infrastructure project in England, it has to whip eleven eighty-fifths of the cost up to Edinburgh pretty damn quick. Seems lunatic and improbable to me, but nothing would surprise me. Can anyone shed any light on it?

47 comments:

chatterbox
said...

Tell you what Iain, why don't you and your crew go off and argue the toss with SNP and leave the rest of us alone!I am just getting sick of it, I believed in the Union because I thought we were all bigger, better and stronger together. Nowadays, I just wonder what the point is, and maybe we would be better apart to stand or fall alone.You whinge about the supposed *extras* that we get in Scotland while the SNP do the same over oil revenue, see a pattern emerging...?You are as bad as each other, and neither speak for the majority. The SNP are clever operators, in fact more clever than you, and they know just which buttons to press today after all the cr*p on the blogsphere this week. Guess what, Alex Salmond and his pals are in the news headlines and they will be delighted. I don't have any time for the likes of George Galloway, but he was bang on the money last night regarding Alex Salmond on Questiontime!

On the Barnett Formula - it works by stipulating that if England spends £x, then public spending in Scotland, Wales and Northern Ireland get a fraction of that £x.

But that doesn't mean every time England commits to spend more money, additional money gets sent immediately to the other Uk countries ("The cheque's in the post, Mr Salmond"). For a start, the vast majority of public spending is agreed for 3 years at a time by the Comprehensive Spending Review. England's figures for this dictate what is spent on the other countries.

Where unexpected spending takes place (i..e not accounted for in the CSR), the calculations of public spending in England are done at regular intervals and grants from HM Treasury adjusted to take account of it.

So because Crossrail was accounted for in the latest CSR, Scotland, Wales and NI's budgets will already have been adjusted to include any element due to them as result. So no extra cheques are currently winging their way to Edinburgh, Cardiff, or Belfast.

The best laugh of all will be if some in the Conservative party down South get involved in this, but then wading in and shooting our own party in the foot while wresting the loaded gun away from Labour is a hobby for some. Salmond and his crew are squaring up for one hell of a fight with the Labour party North and South of the Border, and control of Scotland is the prize. As soon as I read the BBC piece on this, I look past the thrown down gauntlet of the black gold quote to the real story, shame that others did not.

Mr Darling said Scotland was also benefiting indirectly from the £16bn Crossrail project in London: since it is a transport infrastructure project, the Barnett formula meant that Scotland's transport allocation increased.

I'm British, I'm proud to be British and am like you tired of the way the argument always turns round money. It's as bad as Labour complaining about Toffs etc - says more about the complainant than the issue.

Scotland has a small population and one that suffers high deprivation in the central belt with the rest of the population scattered across the country. If it were an English Region I've no doubt the central government grants would be about the same, if not more, than Scotland receives now.

What Scotland needs most though is a Scots Conservative government - not helped by Tories being little Englanders.

Even though we Scots are often portrayed as a bunch of greedy, costly whingers there is a desperate campaign to stop Scottish independence by the Unionists.

If we're that feckless, ungrateful and greedy I can't work out why England doesn't demand we hold an independence referendum and support a "yes" vote. Or simpler still, just declare that the UK is over.

I think that someone's telling financial porkies about how much Scotland disadvantages England. Why is there all the fuss about Scottish independence if it makes such financial sense for England.

if there are cuts in england to english departments then this would surely means there would be cuts in scotland too. its not like all the money is flowing north!!

in fact, if you divide up english expenditure by region you will find some regions getting more than scotland and some englsih regions doing worse than other english regions.

the best solution is independence for scotland. failing that scotlnd should have fiscal autonomy and raise all its own taxes from road, vat, income, etc etc and the scottish finance minister should set the budget for scotland and raise the cash himself.

the problem for the english is not the SNP. The nationalists want scotland to 'reep its own harvest and ring its own till'. until that time comes you cannot blame them from standing up for scotland - they are doing very well at it. if they gain independence then the snp would have to reign in the huge amoung of public sector spending that labour helped build up in scotland over 50 years of domination

Iain, just crossed the border south from Scotland today. The Scottish and local press is full of stories about a inflation only settlement for local government.

My instinct was to assume its a plot by Gordon Brown to make the SNP complain - hence defusing English resentment. Whilst still defending the Barnett formula - or at least saying do you have anything better as he did in PMQ's.

It is also clear the the SNP will make trouble on every issue where it can. But then the critics of devolution always expected this - and the likes of Gordon Brown just ignored it.

PS Remember Gordon gave the SNP an extra £1.5 billion this year by letting them keep the unspent budget from the Lab-Lib Dem administration. At the same time he clawed back £2billion from the English NHS - but refused to make the equivalent Barnett formula reductions to Welsh and Scottish NHS budgets.

I don't think your making a point of these issues is anti-Scottish - its pro-English. And quite right too.

Is this seeming break up of the UK a short term cock up or a long term conspiracy?

One good thing about living a long time is that you soon understand that virtually every single important world event was a conspiracy and virtually nothing was a simple cock-up.

We are in this position because it was planned to happen this way.

BTW

Scottish independence is impossible. How the bugger are they going to be independent from The City of London Corporation when virtually nowhere in the whole world is, least of absolutely nowhere Scotland?

"I'm British, I'm proud to be British"I think you're now well and truly in the minority with that.

"if there are cuts in england to english departments then this would surely means there would be cuts in scotland too"You think? One of the last things the One Eyed Wonder of Wankistan did as Chancellor was to cut £2bn off the bricks and mortar budget of the NHS in England but didn't pass on the decrease to Scotland, Wales and NI. One of the first things the new Scottish Chancellor did was give an "extra" £2bn to the NHS in England, complete with the automatic increase to the Scottish, Welsh and Northern Irish budgets under the Barnett Formula. England broke even from Scotland's new Chancellor's generosity whilst Scotland, Wales and NI made a net gain fo several million each.

Gordon Brown desperately doesn't want an independence vote. He might lose, in which case, he and his Scottish cabal are out of power in England with no chance whatsoever of getting any power in Scotland.

This makes no sense to me .There is no additional money to spend on anything .We are already £30 billion in debt and another amount about the same of balance sheet under the PFI scam( shamelessly used for no good reason as in recent military spending ). Brown took us another £4 billion down shit creek at the last budget and so how can cross Rail possibly be extra money we do nor know about ? Is it another PFI thing ,I would not be at all surprised as Brown is breathing down the neck of his laughable " golden Rule " even with wholesale cheating which he has fought to keep that way thus hidden from the electorateIt surely mist be in the budget somewhere and it is on this basis that the £30 billion is already written in for next year bound to the pictish horde to be squandered on wasteful socialist nonsense. I must say that despite this largesse Salmon’s promises are already un-funded . The £1000 difference is not so much really there is a larger difference between London ad the SE , mind you that is a scandalous state of affairs on its own. About £10 billion will flow into the exchequer from Oil for the next five years due to Oil price rises and I think the deal between the countries is not all that bad if you accept the Oil argument which is , of course , the whole point of nationalism really . Much of the £30 billion is of course collected in Scotland in the first place.

My suspicion is then that Cross rail will be off balance sheet borrowing and not applied to the Barnett formula .Samson n is looking at Oil prices and the promises he has already made ( with nu funds ) and looking to blame as he calls it The UK government. When the money does not appear. This is aprt if huis plan to gather the support he needs for a decisive referendum and is the direct consequence if the asymmetrical position Labour out of their vile instinct for principle free politics left us . This is apolitical move and will form part of campaign similar moves as the hole in the SNP maths unwinds There was a good article in the Telegraph by Alan Cochran ( is that right ?)Just the other day on the differentials between regions.

PS Those Scots who whine about antui Scottish feeling ought to have alok at the fare on your average Scottish Nationalist site . The Scots have many qualities but generosity is not and will never be one of them . Not myth. Stone cold fact

There are major regional issues in England - on average Scotland is richer than many English regions

However in 2000 there was 26% greater public expenditure per head on education in Scotland than the North East of England and 17% greater expenditure on Health and Social Care despite the North East being much poorer.

At a technical level the Barnett formula allows for a population correction but at a time when the Scottish population is fairly static and the English population is increasing by 1% per year ( mainly in the South ) - the formula works to English disadvantage despite the complaints from the SNP about the Barnett squeeze - so that the differential will remain

Never give up, Iain. You have many, many supporters and your passion for justice sets you aside from many in Westminster, who merely feed from their hosts, but serve no purpose.Here's another one that is nothing short of a national disgrace - Prescriptions are free in Wales. Soon to be free in Scotland.In England, the Scottish Chancellor has continuously raised the prices and the money taken from the English for their prescriptions goes into the government's tax coffers and is then divided up and a large share goes to the Celtic fringes.We are seeing our wards and hospitals closing, we are denied the same access to life saving drugs that our neighbours get for free - and we are also taxed on our own medicines to ensure that the neighbours CAN get their for free.Where's the justice in that? Why isn't that money going to the English NHS?One of Gordon's last acts as Chancellor was to slash £2bn from the ENGLISH NHS. He left the Welsh, NI and Scottish NHS intact, even though they too should have been lowered by way of the barnett formula.If our own MPs do not speak out in our defence, what hope is there for the weakest and most needy in England?Shame on those who find the unecessary deaths of our fellow citizens and discriminatory taxes boring!!This is apratheid rule! Silence is the character of a coward.

I clicked on the comments section to this post expecting to find lots of puerile 'ditch the Scots' style rantings - so it was a pleasant surprise to see the measured remarks of the posters so far.

It seems your readers have a broader perspective on this issue than you Iain.

If you do your research you will see that the biggest discrepancy in public spening isn't between Scotland and England, but between London and other English regions.

Would also be interesting to see what Scotland contributes to the public purse (oil revenues et al) per head of population compared to certain English regions of comparable population.

It's fair to say that there is a constitutional imbalance since the formation of the Scottish parliament but a scattergun 'Scots are subsidy junkies' approach is a cretinous mode of argument.

Salmond's playing a great hand at the moment - and maybe deep down the Tories, with the potential of being the largest party in England within their reach,desire Scottish independence to give them a shot at power. But while the UK is intact they need to win seats in Scotland and Wales to win an election and this kind of sloganeering is the very essence of shooting themselves in the foot.

Saw your interview on Newsnight Iain and fully agree with what you said. Also heard Alex Salmond who is running rings round his Labour opponents north and south of the border. No-one I speak to in England begrudges the Scots the right to decide how to spend their money how they wish. Most of the Scots I speak to think the English should have the same right. The trouble is that the same governmemnt which gave the Scots this facility refuses point blank to allow the English the same 'sovereign right to choose the form of government best suited to their needs'. We in England are powerless - more people voted Conservative in England in 2005 but we got Blair and now we have Brown. We don't have PR, we don't have an English parliament, we don't have an English government, we don't have a First minister. We have Brown and his cronies who keep bleating that (a) we can't have 'two classes of MPs' at Westminster and (b) that we must not disturb the sacred Union by allowing the English any self-government. That leaves us with only one solution - leave the Union.

to all the jocks that come on here,the argument is why can Scotland and Wales afford free prescriptions etc.but Scottish MP's running England cannot provide the same for England?It seems Gordon can only afford socialism in the celtic fringe.

Scotland does not contribute "oil revenues" to the UK. The oil is a UK resource. Should Scotland and England split, then the maritime border must be adjusted (it was tweaked by the UK govermment in the 1960s, without consulting the English) which will alter the oil allocation somewhat.

Also, "English regions" - if Scotland is a nation, than so is England. The English electorate has never voted for balkanisation into regions (the North East, the only area allowed a referendum, voted 78% against).

Also, whilst we're on the subject of oil, I have read views from the Orkneys that much of the oil belongs to them and that they are not historically part of Scotland and should strive for independence!

Thinking of our friend Mr Salmond, I'm surprised how practically no bloggers have picked up on the Scottish Lib Dem leader Nicol Stephen's question at the most recent First Ministers Question time.

You can see it on the Scottish Parliament's website, but Stephen raises a fairly shocking fact:

"During the recess, we were told that the First Minister had written to the states that are party to the nuclear non-proliferation treaty to ask for their help to get him observer status at their meetings. Did a shiver run up his spine as he signed letters to the Governments of some of the most despotic, repressive, undemocratic, villainous regimes in the world: Iran, Burma and Zimbabwe?

The First Minister often talks about an arc of prosperity, but he has just written letters to countries in an arc of repression. The situation in Zimbabwe gets worse and worse. Just as the whole world is moving to cast out President Mugabe as a pariah, Scotland's First Minister invites him back in. Dear Robert, he writes,

"I would hope we would be able to count on your government's support ... Please do not hesitate to contact me if you or your government wish to discuss these issues further."

Best wishes, Alex.

Is the First Minister so obsessed with getting a seat in the ante-room at the United Nations? Did he write to Iran, Zimbabwe and Burma? Is there any regime, dictatorship or one-party state to which he will not beg to help the cause of Scottish independence?"

Well done Iain. I am always amazed by the number of ill informed, snide remarks from those that seem to think we should put up with these injustices.

Chatterbox said…why don't you and your crew go off and argue the toss with SNP and leave the rest of us alone!

When we have equality, we will. Until then you’ll just have to put up with people wanting to be treated equally with others in this so called Union.

dougthedoug said I can't work out why England doesn't demand we hold an independence referendum and support a "yes" vote.

Since when have the English ever been asked anything? You're the ones with two referenda on devolution and an SNP promise of one on the European Treaty and Independence. If we did have such a thing, you'd be gone tomorrow...see here http://www.telegraph.co.uk/news/main.jhtml?xml=/news/2006/11/26/nunion26.xml

Skip said … in fact, if you divide up english expenditure by region you will find some regions getting more than scotland and some englsih regions doing worse than other english regions.

In FACT Skip you don’t. Scotland gets more public money than EVERY SINGLE REGION IN ENGLAND AND WALES. See here for the “facts”… http://www.hm-treasury.gov.uk/economic_data_and_tools/finance_spending_statistics/pes_publications/pespub_pesa07.cfm

dougal mcsporran said... Whose oil is it anyway?

It is UK oil. That is unless Scotland became independent overnight.

Ethelred the Unhinged said... The reason for the fuss is that the Tories dislike the Scots because they never vote Conservative.

No, if you take Scotland out of the equation Labour would still have won the last three elections, including 2005 when the Tories won the popular vote. See here for the FACTS http://www.psr.keele.ac.uk/area/uk/ge05/seats.htm

Mark said If you do your research you will see that the biggest discrepancy in public spening isn't between Scotland and England, but between London and other English regions.

If you do a bit more research Mark, you’ll see that the largest discrepancy is between Scotland and everyone else except Northern Ireland. (see Pesa reference above)

If taxes go up to cover the billions spent on crossrail they go up across the UK. It is therefore perfectly reasonable that the Scots budget goes up proportionately so that we can spend our proportionn on infrastructure or whatever here.

There is a perfectly reasonable argument that we get to high a proportion of overall spending here (there is also a fairly reasonable argument about oil money) but your apparent suggestion that the Scots be happy to pay extra for buiilding a tunnel in London is not reasonable & reflects a somewhat Londoncentric view.

Neil, that's a rubbish argument. Infrastructire projects should be built on the basis of need. If a new Scottish motorway is built I wouldn't argue that England should get 11/85ths of the cost. Why should it work the other way around?

I think you mean England should pay the remaining 74 85ths of the cost of the proposed new Glasgow motorway (or tramnine across Edinburgh currently under construction or new Forth bridge which is being considered). However under the present regime these do, I think correctly, come out of the Scottish budget.

Ordovicius, Wales is 1/20th of the population but contributes less than 1/20th of the revenue. By no stretch of the imagination does this mean Wales is subsidising England - not unless you're using the SNP's own special brand of maths where £11.3bn subsidy from the English taxpayer take away £7bn North Sea oil and gas revenues = £several billion subsidy to the rest of the country!

To be fair to our mutton munching friends to the west, they're the closest to being self-sufficient out of the 3 master races.

There was an interesting story on the front page of the Western Mail (Wales' national newspaper) some weeks ago about how the 2012 Olympics would 'cost' Wales to the tune of of £435m.

When you read the story in more detail, it became clear that the Government in Westminster had cleverly designated the 2012 Olympics a 'British event' - if it had been designated 'English', then the formula would have meant an extra £453m to Wales. The Western Mail considered losing out on this money by re-classifying the spend as 'costing' the Welsh taxpayer.

I am genuinely agnostic on who should pay for the Olympics (just Londoners or the whole UK), but I thought this was an interesting example of why exceptional spend (such as the Olympics or Crossrail) should perhaps be excluded entirely from the formula, to aviod silly horsetrading and unreasonable expectations of extra money.

Ordovicius, Wales is 1/20th of the population but contributes less than 1/20th of the revenue.

Incorrect. Apart from the fact that this assumption is not backed up by any figures, you're ignoring the fact that an extremely high proportion of businesses in Wales are -in terms of taxation- based in England.

I am genuinely agnostic on who should pay for the Olympics (just Londoners or the whole UK), but I thought this was an interesting example of why exceptional spend (such as the Olympics or Crossrail) should perhaps be excluded entirely from the formula, to aviod silly horsetrading and unreasonable expectations of extra money.

Morus

The simple truth is that the only logical and fair way to avoid such "horsetrading" is for Wales (and Scotland) to gain fiscal autonomy.

Neil said I think you mean England should pay the remaining 74 85ths of the cost of the proposed new Glasgow motorway (or tramnine across Edinburgh currently under construction or new Forth bridge which is being considered). However under the present regime these do, I think correctly, come out of the Scottish budget.

No Neil, if the Barnett formula exisited in reverse, England would get 11/85ths of the projects cost as extra money to be spent in England. Crazy formula huh?

lguxanIt all depends if the Crossrail money is genuinely new or is already part of the Dept of Transport's Departmental Expenditure Limit. If so then the celtic fringes have already recieved their Barnett consequential as part of their overall bloc. Of course the financing of crossrail is a weird amalgam, with as i understand it the City and various other partners making contributions as well as DoT.

Barnett is a blunt formula, but it is not really all that difficult to comprehend ...

terry is trying to rebut the argument about who spends more per head by including a link which does not lead anywhere. If it did I suspect it show 'identifiable' government expenditure which is a lot less than non identified expenditure a large chunk of which is spent in Greater London or its immediate environs. As an example i'll offer the BBC - the licence fee is just another tax and most of it is spent in London. I could also go on about goverment departments based in and around London, MOD establishments, where does it end in the most subsidised part of the UK?

"Why is there all the fuss about Scottish independence if it makes such financial sense for England?"

Answer... Because if nulab ever loses all its Scottish seats at Westminster, its 'natural' majority in the commons will be lost for ever. The gravy train will stop dead for the labour freeloaders. Expecting Brown and Co to ever let that happen is a bit like expecting the inmates of Auchwitz to vote for the Gestapo.